Prep allows you to manipulate the data into the "shape" that you want - complex pivotting, joining, filtering, calculations etc.. Yes, that sounds a lot like Desktop but all you are doing is preparing the data for Desktop. Prep does a heap of stuff that you could do in Desktop, but a whole lot more as well by making it a single datasource and taking the "load" off Desktop.

Desktop can then take the data and visualise it - graphs & dashboards are simple in Desktop and impossible in Prep. Desktop can publish the workbooks to Tableau Server.

thanks for your answer. My question was actually referring to whether Prep has any new functionality that Desktop is missing...their different scope was quite clear already. You are saying "Prep does a heap of stuff that you could do in Desktop, but a whole lot more as well". I would be interested in understanding that whole lot more...

Tableau Prep is an entirely different paradigm and gives far greater flexibility for manipulating the data.

In Tableau all the joins take place at once (conceptually) and then transformations like pivot or calculations. You do have some ability to do calculations for a join (join calculations) but you cannot do complex transformations before a join (e.g. pivot the data and then join) nor can you join together multiple tables and then union that result to another data set (excepting with Custom SQL). Even with the limitations, the possibilities for data transformation are incredible.

But Tableau Prep takes it to another level. The paradigm here is a flow of data and you can do transformations in any order. You can union and then join that to a pivoted table that has been filtered by a calculation. You can do aggregations and materialize level of detail calculations in your data set, you can create multiple outputs at different levels of detail.

That's the biggest difference: the paradigm and flexibility it gives. As for features that Tableau Prep has that Tableau doesn't, then there are a few that come to mind:

Coordinated pivots

Cross-data source union

Specify order of joins / unions

Aggregate before join / union

Filter before join / union

Pivot before join / union

Join on calculated fields (not just join calculations)

Annotate & Document steps of transformation

Join preview

Data profiling of each step of transformation

Multiple data source outputs

I'm sure there are features I'm missing, but those are the ones I can think of right off.

I'm currently trialling Prep as a way of being able to reproduce the steps associated with a data preparation process for the sake of reproducability and auditing purposes. Other software has the ability to write code to document the process that leads to an analysis-ready dataset, but with Tableau it has always been obscured by the results being visualisations. With Tableau Prep, it looks like the entire process is documented and transparent.